Published: Thu, August 16, 2018
Economy | By

Turkey says it will help firms hit by turmoil

Turkey says it will help firms hit by turmoil

President Recep Tayyip Erdogan on Tuesday said Turkey would boycott United States electronic goods like the iPhone in retaliation for punitive sanctions from Washington, as the Turkish lira finally clawed back some of the ground lost in its stand-off with Washington.

Addressing a conference of his ruling party faithful in the capital, Recep Tayyip Erdogan added fuel to the spat with the US, even as local business groups called on his government to settle it.

The president's comments came after diplomats from both sides met Monday to calm tensions.

The lira's plunge - which had been under way for weeks - was turned into a rout on Friday when US President Donald Trump tweeted that Washington was doubling aluminium and steel tariffs for Turkey.

Turkey on Wednesday said it was hiking tariffs on imports of several key U.S. products in retaliation for American sanctions against Ankara, as the bitter dispute between the two allies that has battered the Turkish lira showed no sign of ending.

Erdogan also renewed a call for Turks to convert their dollars into lira, to help strengthen the currency.

"Believe me, if we divert our money to foreign currency. then we will be in the position of having surrendered to the devil", Erdogan said.

While fears of a crisis in Turkey still loomed, China was in sharp focus as the yuan CNH=EBS sagged almost 0.8 percent to 6.9514 per dollar, hitting its weakest level since January 2017.

Firuz Baglikaya, head of the Association of Turkish Travel Agencies (TURSAB), said there was a 30 percent increase in tourism in Turkey compared to previous year.

Following Monday's meeting between Bolton and Turkish ambassador Serdar Kilic, US officials have given no indication that the United States has been prepared to give ground in the standoff between the two countries' leaders.

Traders said news that Finance Minister Berat Albayrak will hold a conference call with up to 1,000 investors to discuss the economy might also have helped support the currency.

The dispute is one of several between the North Atlantic Treaty Organisation allies, including diverging interests in Syria and USA objections to Ankara's ambition to buy Russian defence systems, that have contributed to instability in Turkish financial markets.

After days of heavy losses, the currency stabilized Tuesday, a day after Turkey's central bank said it was taking steps to ensure financial stability and as the finance minister announced he would hold a conference call with worldwide investors later this week.

The United States' top diplomat in Turkey, Jeffrey Hovenier, visited Brunson on Tuesday and called for his case - and those of others detained in Turkey - to be resolved "without delay" and in a "fair and transparent manner". But, foreign investors are concerned that the central bank may not act because of political interference. Independent economists say Erdogan should let the central bank raise interest rates to support the currency, but he wants low rates to keep the economic growth going.

One Turkish court has rejected an American Christian pastor's appeal to be released from house arrest and for his travel ban to be lifted, but an upper court is yet to rule on the appeal, his lawyer told Reuters on Wednesday. The 50-year-old pastor is charged with terrorism links and spying. He has denied the charges. Although he was released to home detention, he faces a prison sentence of up to 35 years if he is convicted at the end of his ongoing trial. Mario Ritter was the editor. Susan Shand adapted it for Learning English.

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